Sunday, July 21, 2013

When have econ blogs changed your mind about something?

There are quite a lot of strong priors in the world, and there's also quite a lot of confirmation bias, which is even worse. I'd like to think I'm about as susceptible to these things as the average person. But there are also a lot of cases when reasonable argumentation has changed my mind about this issue or that. Thinking back, I can remember several instances in which reading econ blogs made me totally switch my position. To wit:

1. Tyler Cowen convinced me that the Great Stagnation is real.
At first I was very skeptical; citing slow productivity growth as evidence of stagnating technology seemed a bit like low-frequency RBC, and the ongoing boom in the productivity of durable-goods manufacturing seemed to belie the technological stagnation thesis. But Tyler brought two pieces of evidence that changed my mind. First, the point that the Stagnation is not just technological, but also resource-based - we have mostly run out of unexploited natural resources and easy educational gains - was a key one. Second, unlike in RBC models, the Great Stagnation can mostly be tied to an observable piece of technological stagnation: energy. Cheap oil began to end around the same time that the Great Stagnation began. That's too striking to ignore, though I still suspect that globalization may also be affecting the TFP figures.

2. Paul Krugman convinced me that American politics is largely about race and the South.
I was raised to believe that American politics was all about class; the GOP was the party of the rich and the Democrats were the party of the poor. My parents told me that, my teachers told me that. Although I still think class matters, on the margin, I now think that race and the legacy of the Confederate civilization matter a lot as well, especially on the margin. Paul Krugman basically convinced me of that all by himself back in the early 2000s, though nowadays it seems that everyone has picked up this thread. Krugman is still saying smart things about race and politics, however.

3. Alex Tabarrok and Matt Yglesias convinced me that the patent system is broken.
I was raised to love patents - Public goods! Reward the nerds for their hard work and smarts! But after reading a lot of blog posts by Tabarrok and Yglesias about the abuses of the system, I have come to believe that the modern American patent system is fundamentally broken and needs substantial reform, and that lots of patents - perhaps even the majority of patents - are doing more harm than good.

4. The whole blogosphere convinced me that the Reinhart-Rogoff 90% thing was total BS.
I am not ashamed to admit that I bought into the Reinhart-Rogoff talking point that a 90% debt-to-GDP ratio spelled trouble for growth; anecdotally, high debt and slow growth had coincided in Japan, and there were some theoretical reasons to believe in some sort of negative debt-growth relationship, and I assumed R&R had done their homework, and I also had been convinced by their point that financial crises prolong subsequent recessions. So I accepted their 90% number, though I maintained some reservations due to the general difficulty of drawing any kind of conclusions from that kind of data. But then...well, the rest is history. Miles Kimball's posts on the subject were possibly the most convincing of all. 90% is well and truly dead.

5. Ramez Naam convinced me that solar is real and huge.
I used to buy the conventional wisdom that solar costs would always be too high for solar to be a viable cost-effective alternative energy source without huge government subsidies. My hopes for alt-energy were always pinned on nuclear, and maybe advanced biofuels. Then Ramez Naam came along and demolished my entire worldview with a single post. Of course trends can stop, but this trend is too long and too strong to hand-wave away. Solar is real, and it's huge. If the cost trend holds just a little longer, the point where unsubsidized solar is cheaper than coal is coming very soon - maybe five years from now.

There were also some instances in which my perspective didn't reverse entirely, but became much more mixed and nuanced, after reading blogs. For example:

6. Steve Williamson convinced me that the macro field is structurally biased toward monetarism.
I can't find the post(s) now, but Williamson has pointed out that central bank macroeconomists have a strong incentive to choose and promote models in which independent, active central banks are the most important stewards of macroeconomic stability. Since a big percent of top macroeconomists work at central banks, this is a non-trivial observation. I was trained to be pretty monetarist (by Miles Kimball and somewhat by Bob Barsky), but Williamson's point was a good one, and has given me pause. Of course, it's a bit of a cynical Marxist type point, but a good one nonetheless.

7. Paul Krugman convinced me that Japan's 1990s stimulus had some positive effects.
Living in Japan in the mid 2000s, I picked up the conventional expat wisdom that Japan's "fiscal stimulus" was a total waste, driven by clientelist construction spending and LDP corruption, concreting over the riverbeds and building bridges to nowhere. And while I still believe there was a ton of waste, Krugman blogged some data showing how mild Japan's two recessions in the 90s were, despite the incredible severity of the country's financial crisis. That's a powerful argument. I now believe that though Japan's 1990s spending spree probably wasn't worth it on balance, it probably was not quite as unmitigated a waste as I had thought.

Those are most of the examples I can think of. Not a lot, but not nothing either! Derp is strong, but it is not all-powerful.

What are your examples? Other bloggers, feel free to give your lists as well. (Note: To make the list, a blog has to have actually changed your mind about something, not just convinced you of a position where you had none to begin with!)

I found downward nominal wage rigidity pretty implausible at first, especially the kind imposed not by employers but by employees, but I've been convinced that it's very a real and very tragic phenomenon.

(Would anyone but a reader of the econ blogosphere use the word "tragic" to describe "downward nominal wage rigidity"?)

Paul Krugman has convinced me that nominal wage rigidity is not as bad as one might think. He made two points: 1) contracts are not (usually) downwardly flexible. Downward wage movement would push people closer to bankruptcy. 2) More importantly, downward wage movement reduces aggregate demand, just as unemployment does. So, downward wage movement might reduce unemployment, but it wouldn't help the main problem, insufficient aggregate demand.

Krugman at least as recently as last year still thought that downward nominal wage rigidity was "bad" if by that word you mean "real." I think he thinks it's not "bad," but he does think it's very much real.

And on the opposite end of the ideological spectrum, Bryan Caplan finds the evidence that DNWR is both "real and durable" convincing (he wrote the words in quotes about it this year): http://econlog.econlib.org/archives/2012/09/long-run_unempl.html

...Frederic, I think the other data point you're looking for is the large *increase* in the proportion of workers earning 0% pay changes. It's not just the level, it's the increase starting during a recession and staying elevated for a few years afterwards.

That's the empirical side.

On the theoretical side, there are private-sector factors (e.g. pay cuts reduce morale and hence reduce productivity, so cutting pay effectively reduces the unemployed worker's MP to below zero), and there are public-sector factors (e.g. minimum wage laws are by definition a downward nominal wage rigidity.

You can look at the theory & evidence yourself, or you can take an epistemic shortcut (lazily but understandably) and conclude that if a strong libertarian, a strong Keynesian, and a market monetarist agree on something, it's probably true.

(There is also the argument from common sense: if you were a CEO, and you could shave just one single penny off of each of your 100 workers' wages and use it to hire another worker, assuming that labor supply is in excess (which it is) then none of your workers would quit and you'd effectively have hired another worker at zero cost. Would you do that? Why or why not? And if so, do you know something American CEO's don't know...?)

He's not often thought of as an econ-blogger, but he is one: Michael Clemens has convinced me that immigration is the single most important issue in American politics from a utilitarian/humanitarian perspective (not from a political perspective, obviously). He's done more to convince me of that than even Bryan Caplan.

Ta-Nehisi Coates convinced me that the Civil War probably could not have been prevented by purchasing the slaves from slaveholders and emancipating them as Ron Paul claimed. This in turn made me question many of my priors on Ron Paul and his supporters and their unfortunate past associations, e.g. Gary North.

Izabella Kaminska, Cullen Roche and a variety of others taught me about the collateral shortage, which made me reconsider my understanding of quantitative easing.

You convinced me to read Krugman's New Economic Geography, which led me to take a much less critical line on Krugman and start reading his blog daily.

Steve Keen convinced me to read Minsky and consider implications of endogenous money and effects of debt on aggregate demand more fully. David Beckworth made me reconsider this view through the lens of what he calls "monetary disequilibrium".

Oh, okay, you've just convinced me to give Tyler Cowen's Great Stagnation another try. I am still not sure about oil being the main driver of the slow growth since the mid 70s although, sure, energy and greater energy use is linked to progress on a civilisation scale.

I still think it's funny (and more important) that labour share of GDP starts falling about the same time (well, 1980 rather than 1973 but still...)

But I do like the split between goods TFP and non-good TFP. It's definitely worth investigating more.

On Market Monetarism, Scott Sumner did convince me that the CB can always and everywhere creates inflation (even if the point of creating inflation is, to my mind, totally debatable and I don't buy that QE-infinity ++ would be what we need to get out of our morass.

Chris Dillow taught me not to be ashamed of the part of my thinking that is Marxian-like.

In general, political conservatives have convinced me that culture and attitudes matter, at the margin...

1) Brad DeLong's coverage of WW II has convinced me that the Battle of Kursk wasn't all that decisive - even if the Germans had eked out some sort of victory the situation on the ground wouldn't have been all that different.

2) Mark Thoma and others convinced me that increasing the minimum wage, while still probably a 4th or 5th best policy, was a policy to push for and not against. Essentially convincing me that the costs weren't as big as I assumed, and the probabilities of a better policy succeeding were pretty low.

Technology stagnating? File this one under not even wrong. Cowen has been roundly mocked by many people for not even being able to define measurable terms, let alone actually measure them. I suspect this blind spot comes from the fact that many - most - economists aren't especially up on science and technology, and for the simple reason most of them aren't up on science and math. They tend to think of technology as something like a better smart phone ;-)

And you got someone as insignificant as Ben Bernanke kind of agreeing with Cowen in comparing the progress between 1910 and 1960, on one hand and from 1960 to 2010 on the other...

Though I agree that it's a bit of a stretch to call TFP "technology". My instinct is that technology is progressing fast but maybe our capacity to deploy it for world-changing effects is not as good as it used to? Maybe something else?

Yeah, proxies aren't worth a damn, especially just on someone's uninformed say-so. Look at this breakdown, for example.

The problem is - as I said - that no one has a clear notion of what 'technological progress' is or how to measure it. I've also heard different people avow that there's not been much progress in other disciplines but in theirs it's exploded (sorta like Washington sucks, but my representatives are doing just fine). Iow, no one person is going to have a definitive handle on this one. And certainly a not-particularly-adept economist who doesn't appear to know much about science - and with an axe to grind to boot.

The under-praised and under-appreciated blog ribbonfarm has very interesting things to say about The Great Stagnation by historical analogy:http://www.ribbonfarm.com/2012/03/08/halls-law-the-nineteenth-century-prequel-to-moores-law/

I do think the resource issue is extremely significant (but then I would, wouldn't I, given my view on overpopulation and where it's headed).

The real problem is that (as far as I can tell) Cowen is incapable, or uninterested in, distinguishing between - rising technology and knowledge- rising gross national income- rising median income- world and US incomesHe slips between different versions of these at different times, which makes it hard to argue with him and makes the whole enterprise come across as very much something written to justify a pre-existing set of preferred policies.

What's interesting to me is that in this instance Noah seems to have been converted by a set of anecdotal stories WITHOUT A MATHEMATICAL ECONOMIC MODEL. What this tells me is that in economics blogs rhetoric is extremely powerful, at least as powerful as economic modeling. (Compare with the modeling in the solar story Noah cites.)

1) Krugman and Delong convinced me that WWII was largely caused by a misunderstanding of economics. Sure, there were bigotries that played a huge role in causing it, but fundamentally people went along with it because the economics worked.

2) Krugman convinced me that there really is no reason whatsoever that recessions and depressions should be allowed to happen. That every piece of evidence suggests that everyone is better off if we fight them hard and eliminate them.

3) Yes, the patent system is completely broken. I was supposed to exist for the small startup to ensure a business model that could reward the hard work of creating an invention. It has been overtaken by the patent trolls, huge money, large corporations that use patents for no societal good.

4) I learned from all of the blogs that people like to talk more than they listen. The blog model is broken as a means of communication. It needs a bit of synchronization to make it better.

"2) Krugman convinced me that there really is no reason whatsoever that recessions and depressions should be allowed to happen. That every piece of evidence suggests that everyone is better off if we fight them hard and eliminate them."

Alas, not quite everyone. Recessions and depressions are good opportunities for wealthy people and corporations to buy up even more of the world at fire-sale prices.

Priors are something that people resist changing because changing them is embarrassing, and our system doesn't reward honest reflection upon our wrongs.

However, if people are willing to change their mind in a public place, more and more people will be willing to do it. It will become more acceptable.

Would you and others be willing to try out my new blog site? I'm still working on making it more like what people expect from a blog site.

The goal is an honest public discussion where people can overcome priors and achieve a better understanding of each other's perspective.

The technical aspect is just the focal point. The real power is in large social groups using a technical focal point as their reference, but not everyone needs to use the technology for that to happen. Only perhaps 1 in a hundred need to participate, and the other non-technical social networks can take care of the rest.

I had always assumed that economics PhDs were equivalent to most other PhDs and that their ethics and methods were comparable to those who had doctorates in the hard sciences. After 2008, reading James Galbraith and Dean Baker, I discovered that most economists are either paid to be idiots, liars, mouthpieces of the powerful. To discover that an economics degree is roughly equivalent to a degree in Theology is dismaying to say the least. While there are those economists who make a contribution to their field, the fact that many of those economists in positions of power can ignore 70 years of hard earned economic experience and condemn millions of innocent people to years of unemployment and destitution is incredulous to me. I never understood The Great Depression until 2008-2009. Now I understand. Greed and erroneous beliefs have the power to cause the gravest evils upon humanity.

Yea, that pretty much sums it up. And it is really sad. I actually feel really bad for people who go into economics with good intentions. It takes a lot of work, but when they get done, nobody wants them to use it for good. They want them to use it for profit, and that is an absolute tragedy.

The problem is, economists don't effectively police their own ranks. It's as if Lysenkoists were paid just as much mind by their colleagues as they paid to Darwinists . . . and I say that as someone who likes DSGE models (with modifications) and is into the big data (mathematical) side of economics.

Actually, it's more like real Lysenkoism. The Lysenkoists get the goodies, the Darwinists get sent to the gulag, or, if they are lucky, are simply ignored. Stalin's regime liked Lysenko's theories, because they fit with the prevailing theory of the perfectibility of the individual, rather than Darwin's optimization curve following randomness. As one blogger put it, Darwin is like Mexican soap operas - stuff just happens, while its alternatives are like Virgil's Aeneid with his eyes on the prize. The state narrative was political in Virgil's day. It is political now.

#6 sounds only vaguely like something I might have written, which I think tells you something. The blogosphere may be more like a game of telephone that serves to garble whatever shreds of useful knowledge go into the machine. In this instance, what I think is true is that monetary policymakers, like many people with power, will lovingly support any theoretical apparatus that appears to validate what they have been doing. That seems pretty obvious. Case in point is New Keynesianism, which central banks supported in a big way. But that is definitely not monetarism - old or new. I think you're confusing monetarism with monetary non-neutrality. Keynesians have always been for the latter. Old monetarists, Friedman in particular, wrote extensively about non-neutrality (the contribution there is mainly empirical), but didn't think any central bank should exploit it. That's hardly in line with current central banking practice in the United States. A new monetarist doesn't like New Keynesianism so much, mainly because it gives short shrift to the details of monetary exchange, credit and banking. There's an inclination of New Keynesians to be better at those things, but they have a lot of ground to make up.

I'm willing to let this econoblogosphere use the product for free if necessary. But I do have to charge a fee for that which costs me money to create, maintain and run. The work that went into conceiving this idea and creating it was absolutely enormous. I do need to compensate myself for my work.

Acemoglu and Robinson convinced me that lots of what is ailing poor countries has roots much deeper in history than economists like Jeff Sachs would have it. In particular, they convinced me that European colonialism is a lasting contribution that often goes unmentioned in seemingly value-free economic assessments. I am not versed in the history of economic thought, but as far as I am concerned, A/R have single-handedly turned around my world-view that a) it's time to stop complaining about colonialism and that those former colonies accept how they screwed up themselves (look at the Asian tigers!), and b) that their fate is something grounded in factors like the environment etc that one simply cannot do much about.

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On point #1, Tyler is out to lunch. It is completely bogus. You cannot look at the timing of events and assume a causal relationship. You are better than to fall for this right-wing propaganda.

Energy has absolutely nothing to do with our current economic trends. Nothing. We're in a demand-constrained environment as clearly shown by the models.

Globalization, however, is absolutely to blame for what is happening.

Why is this so? Because our ideas and models of economic activity have always depended upon a hermetic operating environment. The morals are a given. The desire for equity and fairness depends upon a hermetic system, and when those promises are broken, our preconceived notions of economic activity break down. They fail to function properly.

So globalization is not a bad thing. It is a good thing. But to allow globalization to work, sovereign nations need to act like sovereign nations that care about their people. They have to put restraint upon market forces that would have you and every American working for slave wages because the market demands it.

The Great Stagnation has a lot of possible causes. Sure, the energy crisis might have been one cause, but the book A Great Leap Forward which is all about 20th century US TFP argues it was the build out of the interstate highway system. Being a political sort, I argue it was the pro-business economic climate that triumphed in the 1980s. (After all, pro-business red states are poorer than anti-business blue states.)

It's usually not one blogger who gets me to change my mind, but they'll often get me on the right track.

I have learned dozens of things I did not know from blogs. I may have thought about the issue, but didn’t know enough to have a firm opinion. Opinion changes are less frequent. Off the top of my head, these are some areas in which blogs prodded me to look further, leading ultimately to a change in mind.

Nominal GDP targeting is good idea.

Bob Mundell was probably right all along about the EC.

Hamilton convinced me that Keystone XL makes sense; others that solar power may soon replace coal in a lot of uses and other fossil fuels in the not too distant future.

Glaeser that cities are really efficient (one of those areas where I knew very little but nevertheless had a strong opinion).

That studies based on IRS data of changes in the distribution of income over time are not merely reporting artifacts of the tax code. I have also come to believe that tax collection and enforcement is very hard and that it isn’t easy to fix and deserves far more attention than it gets).

Transfers are more important than taxes for achieving a more equitable society (Lane Kenworthy -- who has probably changed my mind on more things than any other blogger, although not an economist).

Minimum wage laws do more harm than good and should be applied more universally, especially to agricultural workers.

Gun violence is a hugely serious problem and that it can be seriously addressed without violating legitimate rights and interests. (This probably falls more into the new stuff category). Poison is almost as bad.

Scott Sumner has convinced me that it is better that the central bank target NGDP than to target the inflation rate. And that it is better to target levels than rates (ie, make up for past under and over shooting).

On point 6, it is hard to argue with the idea that monetary systems should be the primary avenue for macroeconomic stabilization.

The very essence is that a lot of really smart people studied how economies work and discovered some truths that don't necessarily always align with public knowledge and desire. Therefore, economic stabilization should be primarily the jurisdiction of monetary policy.

We just need to make sure the central banks have the authority to correct the debt imbalances that often plague economies, and so they should have the power to print asset notes to suck debt into the central bank when it becomes a menace to economic stability.

I used to think there were intelligent conservatives. But my mind was changed when reading the "Market Monetarists" and I discovered that conservatives truly are retarded deep down in their derpy little hearts.

The reason this is so hard to get a grasp on is because there are so many different kinds of people that make up a political party. The conservative leaders are derby to the core. But the propaganda that results from them trying to push their derby ideas on to people are fairly convincing.

So Conservatives are not a hermetic group. Conservative voters, are by and large, confused. They're not derpy, they're confused.

Does it count when a blogger changes your mind by agreeing with you? Because I used to take for granted that 'the central bank moves last' until Tyler Cowen asserted this one time too many without support, causing me to reexamine my assumptions.

That is a part of what I would call the ethically-challenged ramifications of the blogosphere.

Changing a blogger's mind is likely to loom large in a commenter's mind simply because of the authoritative nature of a blog. Regardless of merit, changing the mind of a claimed authority figure is likely to yield substantial capital to the ego, whether deserved or undeserved.

Mankiw, Taylor, Cochrane and Niall have convinced me since you can be constantly wrong and still be "respected", that the field of economics - once an important source of study to help improve the world - is now functionally irrelevant.

Ferguson and Mankiw also fill me with shame that my alma mater employs them, and have tarnished the name of Harvard forever.

Hmmm . . . blogs like AngryBear (and - again - Krugman) have also convinced me that you don't need much more than an Excel spreadsheet to analyze a lot of claims made by economists. Or rather, when it comes to disproving bad claims about economics, it often doesn't take anything more than a spreadsheet at the first cut to dismiss them.

What was horrible was that it took years to obtain the Reinhart and Rogoff spreadsheet and to disprove their model due to errors in that spreadsheet. The original results gave a lot of policymakers coverage to justify their bad policies that demanded austerity. A scientist would be discredited and humiliated. But, as you pointed out, economists don't police their ranks and failure is rewarded among elite economists. Geither fails upward. Bernanke keeps his job for failing to see an $8 trillion housing bubble and letting it burst. Summers is a walking disaster as well.

In 2008, like so many others, I was convinced that massive increase in inflation and interest rates due to ballooning money supply & deficits were coming shortly. Krugman convinced me otherwise. Krugman also convinced me that many people with impressive credentials are complete and utter morons. Finally, he convinced me that I should read his blog every day.

This is a really good question. It's hard for me to answer since I am not an economist and didn't start off with a lot of well-defined opinions about economics per se, although I had a lot of political and moral attitudes about topics on which economics has a bearing. My opinions on about 75% of everything have changed significantly since 2008, and I know a lot of those changes have had something to do with thrashing things out in the economics blogs, but it is very hard for me to point to specific facts or arguments that have been decisive.

While learning a lot of economics on the fly, I also learned something about economists and their culture. And some of what I learned surprised me.

One thing I learned is that economists have remarkably similar views about the best way to organize our social and economic lives. That surprised me. I started from the idea that the social world we live in is highly defective, in many ways even horrifying, and the reason to learn more about economics was to develop the insights and intellectual tools needed to develop ideas and strategies for radical change over time. But economists as a profession seem to think we live in something not far from the best of all possible worlds, and that the only thing worth debating is the best means of stabilizing it when it goes a little bit funny.

Also, as far as I can tell, economists are almost all Social Darwinists. The main difference is between people who declare their Social Darwinism bluntly and those who avoid frank discussion of indelicate questions of human domination, subordination and genetic superiority.

Also: economists hate democracy. I mean all of them, everywhere. I can't think of a single economist I have come across who seems devoted to democratic ideals. They really, really hate it. Democracy is apparently, for them, a system that interferes with the natural order in which a society is run by its most accomplished and aggressive alpha performers, and its duly credentialed experts, and allocation problems are solved in favor of the special.

Prior to 2008, I would have been very skeptical of the idea that there was really such a thing as class warfare. I would have accepted that people have class-based interests that they seek in their own lives to defend. But the idea that these interests manifested themselves in something analogous to organized warfare struck me as absurdly conspiratorial. But no longer. Now it seems to me that during periods of economic stress, people form very effective ad hoc coalitions in short order founded on a mutually perceived need to defend existing systems of hierarchy and privilege against opportunistic attacks from subordinated groups. So, whether its Harvard economics professors, or NPR and its "Planet Money", or the Washington Post, or the top media/publishing conglomerates, or the Wall Street Journal, or CNN, or Freakanomics or the US Senate, or the White House, the fundamental economic and social message is remarkably consistent: the rich are necessary; avaricious accumulation serves society; governments muck things up; the experts must inflict pain for their own good; the best way to fix problems is to begin with the markets in which the rich compete, and let things filter down from there; the lowly are lowly because they are dumb, fat and incompetent, and so they should be grateful that they are even tolerated; the working poor are overpaid and spoiled and need to become more competitive with the working poor elsewhere.

I've been at the economist game for a while (finished grad school in the early 1970s) and have mostly done applied micro (both as a teacher and as a researcher). What the blogosphere has done for me is to re-introduce me to many macro issues that I had paid little attention to for 25 years or so. And, in fact, while I had come to believe that Keynesian economics was of little relevance, Krugman (and some others) convinced me that I was wrong...which led me to re-read The General Theory (and A Tract on Monetary Reform) and to become reconvinced that Keynes got a lot more right than people now tend to give him credit for.

Generally, liberals, and just the general population, are far less dogmatic and desirous of simple black and white than conservatives. So our priors are a lot less strong.

Sure, I have some strong priors like the Earth is round and libertarian economics is incredibly inefficient and harmful with regard to maximizing total societal utils, but with the evidence and logic ridiculously overwhelming, I don’t expect to be convinced by a blogger that the Earth is flat or libertarian economics is efficient.

It’s more I gain valuable knowledge and understanding from bloggers on areas and specifics I didn’t have a particularly strong prior about.

One thing I had a somewhat strong prior about was I would have thought that something as big as the aluminum market couldn’t be manipulated greatly by rapacious Goldman-Sachs, then I see a blogger I really respect, Kevin Drum, saying maybe it is. That’s definitely loosened my prior, although at this point I’m far from convinced.

Pre-blogosphere, I just generally thought that the patent system (including copyrights) may have had flawed details, but probably wasn’t severely severely inefficient (for maximizing total societal utils, vastly more important to me, and I think most people, than Pareto optimality). Now, thanks to the blogosphere, I see it’s a nightmare. But my previous prior was never THAT strong because it wasn’t something I ever studied much.

Thanks Annon! This isn't an area I have a lot of expertise in, but I know power plants tend to have a lot of monopoly power over their local area or region due to very high economies of scale and costs/lack of infrastructure to transport electricity long distances. Aluminum, however, seemed like a huge national, or global, and pretty fungible market. I hadn't heard about a LIBOR issue.

I learned about endogenous money from working at a bank for 15 years (ALM, money desk, investments, capital markets). In the last couple years, I started reading econ blogs. Because, fun!

And what I've "learned" is that (apparently) for every borrower, there is a saver. Minor detail? That's not how it actually works. For every borrower, there is a bank that deems them creditworthy (with the "innovation" of securitizations, this only need apply for 1-3 months before taken off the books) and then creates a brand new deposit "out of thin air" by simply marking-up a deposit account equal to the size of the loan. This happens every single time a loan is made. And there are no savers and no "multiplied deposits" in sight.

I realize this is how economists WANT banks to work because it's a nice, simple story. But that's all it is...a story.

Noah, you recently made the claim that normal people view macroeconomics as political, while most economists don't. And I'd argue that banks have never operated under "multiplying-deposits" models or loanable funds theories, while economists get to make claims otherwise. In fact, in 15 years working in the industry, I've never even heard those terms used or those theories applied. Not once. Which, after 15 years, I will conclude covers both the short and long-term.

Perhaps bankers and economists should get together at some point and tell their respective stories. Because for us normal people, it matters. A lot.

Maybe it's because I worked in banking too but I don't think economists are limited to deposit-multiplier theories.

Rather the loan-to-deposit ratio is one easy measure of leverage/liquidity.

And saving rates may not matter for actual loans to be made but, in aggregate, when they are either too low or too high, it's usually the sign of something out of whack, as per a variation/common sense understanding of the life cycle hypothesis

Dean Baker convinced me that the great recession wasn't caused by wall street banks failing, but by the deflation of a worldwide asset bubble, and even if not a single bank had been over-levered and/or failed, we would have been stuck in the same depression due to the lack of demand. (This is not to absolve them of their drain on society, however.)

He also convinced me that Paul Volcker isn't the savior he is made out to be for "slaying inflation" back in the 80s - it fell worldwide at the exact same time (even in countries devoid of central bankers raising rates), and it's likely he did more harm than good by creating an unnecessary recession.

He also convinced me the patent system is broken and harmful, social security isn't in bad shape at all, neither are pensions, that "free" trade deals are anything but, and that the press is probably one of the biggest problems we have in this country, spoon-feeding lies and omissions daily to the masses. He and Krugman together convinced me inflation isn't always necessarily bad. Baker also convinced me that people have seen even less of an "increase" in wages from productivity over the last 3 decades because money given to them in the form of health insurance is essentially just wages to doctors, and workers are in no better position - worse in fact, because their wages would otherwise be higher.

Duncan Black convinced me the 401k experiment has been a disaster.

Brad Delong convinced me that financial advisers are useless and the best bet is to put your money in a low-fee fund.

Alan Greenspan has convinced me that evil exists.

And finally, Dean Baker has convinced me that being an economist is the greatest job in the world: you can always be wrong and even completely ignorant of your craft (as the gross majority are) and still has absolute job security and above average wages!

Well, I used to think that wall street destroyed the economy, paul volcker slayed inflation, patents were necessary for the smart people to do anything and were "property rights," social security is in bad shape, "free" trade deals existed, and that the press was just "giving both sides," inflation is evil because it steals your money, and that wages are higher than they were in the 80s, 401k's are a good idea (but workers were just dumb in their investment choices), financial advisers are qualified individuals who provide value to their customers, that I could "beat the market" with my own intelligence, and that economists knew what they were talking about.

Obviously I wasn't as smart as I thought I was. I really believed all that crap. That's all I've been told my entire life, all I've read, and all that's "accepted" by the majority of people. Go try to convince an "average" person you run into today that any of those are incorrect, they'll think YOU are the crazy one.

I guess the only one I didn't change my mind about was evil existing. But I used to think Greenspan had an idea what he was doing and that it was for the public good. Holy hell was I wrong.

@Anon, almost all of those "priors" seem to be consistent with each other except for the first "Wall Street destroyed the economy". Is that about the point about asset bubble vs. financial crisis? If so, Wall Street's policy influence over 2 decades has much to do with the increasing vulnerability of the economy to crisis, even if not the proximate cause.

I suppose I have to credit Jonathan F. Catalan for his leadership by example. I also have to attribute the same to Daniel P. Kuehn.

Jonathan and I still disagree and subscribe to different frameworks in economics - I'm closer to the Keynesian framework, and he is closer to the Austrian framework.

Although I don't consider myself an Austrian still, the fact that Jonathan F. Catalan eventually took the time to understand his opponents by reading their work for himself and attempting to understand the framework on the opposition's own terms, struck me as quite admirable.

Although I don't consider myself widely read in the literature of the Austrian School, I did take the time to read through a few works by thinkers in that tradition (if you want me to be specific, I've made some way into The Theory of Money and Credit by Ludwig von Mises, and I have made more progress in reading Individualism and Economic Order by Friedrich Hayek).

As for Daniel Kuehn...he also did a similar thing by engaging people who affiliate themselves with the Austrian School, and taking the time to listen to them. Anyone can go look at the records of his blog to see this if somebody doubts me.

But with cheap electricity, you can make cheap fuels, like hydrogen. Plus, rechargers and batteries could get a lot better. I did hear somewhere that some expert was talking about storing electricity in chemical fuels as promising.

Tyler Cowen is wrong about the great stagnation. We are on the cusp of technology radically changing the basic structure of our economy.

First, in the pipeline are a large number of inexpensive, wearable diagnostic devices which are going to alter the delivery of health care in ways Cowen lacks the capacity to foresee.

Second, the driverless car will likely change society more than did the car. Recall that auto accidents are a $1 trillion dollar business (insurance, hospital bills, repairs, time lost) which will virtually vanish on deployment, at huge cost savings to consumers. They will alter urban land scape as well.

Third, robots are very soon going to radically change the very inefficient construction business into being very efficient.

Fourth, robotic mfg. is going to drive down the costs of producing everything. How far are we from cars being entirely assembled by robots? The WSJ had a recent story on a new steal factory where 320 workers are replacing an old factory of 5000 workers. That is anything but stagnation.

Last, a little on the limb, but personal hybrid robot drones, which roll and fly, are going to alter the battle against crime. Everyone is going to have their own police person. The elimination of the cost of crime is going to be huge. $300 for a hybrid v. more than $1,000 per person in taxes for police officer.

I don't see Tyler Cowen being right about anything. He underestimates the extent to which politics is driving technological change and globalization, that is, economic change. They're not pre-ordained.

My mind was changed about monetary policy. Before I believed it wasn't that effective, now I believe it hasn't really been tried except in Japan to a small extent. I'm not a monetarist or a follower of Sumner, though, given that I still believe fiscal policy is highly effective.

Dean Baker changed my mind about the importance of currency policy and the trade deficit. Like monetary policy, it really wasn't on the radar. I had been taught that the Great Depression was ended by the WPA and then rearmament. But monetary and trade policy have large effects and the corporate media underplays their efficacy.

Sumner's convinced me of something, but I don't know exactly what. Maybe it's the importance of the Fed reaction function? Maybe the role of expectations (although maybe he doesn't deserve the credit, even if it's largely where I encountered it). Maybe it's something else (perhaps not hippy-bashing). I guess he's probably convinced me that "inflation" is a useful concept but a poor thing to try to measure and base a policy on.

As for your list, I'm not sold on the stagnation story. Or, more accurately, I'm not sold on what the implications of it should be or that we are very good at measuring TFP.

Mike Beggs writing in Jacobin has a really great piece on zombie Marxism. Though I think there are really smart and creative economists who self-identify as Marxist, the idea that there is a coherent, alternative body of theory is a notion that I became suspicious of the first time I hung out an URPE conference.

There are valid points of critique, but certainly no methological or empirical silver bullets buried in Das Kapital.

The same could be said of many heterodox schools (even if mainstream econ has its weakness and blind spots), critique is not the same thing as having an alternative theory is not the same as testing that theory.

I'd say the same thing about patent and copyrights, except through Dean Baker. I saw them as necessary before, maybe in need of some tweaks, but now I'm thoroughly convinced that we need to find a better way to fund research and artwork.

J. W. Mason convinced me that the shareholder revolution has caused large firms to be more short-term and has contributed to underinvestment and stagnation. As young as I am, I was not aware that this is not the way things always were, and I certainly wasn't aware that not every economist agreed that having firms exist entirely for the benefit of their shareholders didn't necessarily create the best incentives.

Peter Turchin (not an economist) convinced me that historically the stagnation or growth of middle class wages has been primarily driven by changes in the size of the labor force, and that the coming retirement of the baby boomers may be the best thing the middle class has in store for them. Okay, I'm not entirely convinced of this, but I certainly didn't think this way before. Your own post on how no economist understands why Japan isn't as stagnant as it was added further plausibility to this for me.

Steve Randy Waldman convinced me that not only is Paul Krugman capable of being wrong, he can get things wrong by ignoring something big and obvious.

That's an interesting idea, sort of like the way the Black Death caused a labor shortage and raised wages.

But eventually the landlords struck back and enacted wage caps. A lot of those boomers are stockholders. If a declining labor pool leads to higher wages and a reduced return to capital, watch the oldsters lobby Congress to freeze wages and get their dividends back, on the theory that the increases represent an unjustified labor windfall caused by a demographic distortion.

People only like free markets to the extent they serve their interest. The boomers loosened things up and became neoliberal market fundamentalists when they were aspirational yuppies trying to stick it to their parents and old labor, and get lower consumer prices. But if they start losing at the lissez faire game, they'll change the rules.

And I previously figured inequality was largely driven by political decisions like this. I still think it's a major factor.

Which reminds me of another surprising thing I've learned about economists -- they tend to be very dismissive of ideas that suggest the economy is affected by things outside of the domain expertise of economists. That includes politics. Politics either throws sand into the gears of the economy or does nothing, maybe excepting certain policies clearly designed around widely accepted economic models. Inequality might be due to globalization or technology, but it cannot be because taxes for the wealthiest were cut in half. That either had a negligible effect or was forced on us by economics; the alternative -- that we could just choose whether our economy is a high inequality one or low inequality one -- is unthinkable. Economic changes must be due to economics.

@Eric, JW writes some really thought provoking stuff and I come away from his posts thinking DSGE is a dead-end, not even "wrong". His points about how mainstream econ (particularly macro) is all about, not microfoundations, but a very narrow and deficient version of rationality for which there is an intense institutional bias with econ is very interesting.

As to politics, totally agree that even bloggers I tend to agree with seem to routinely shut out political questions that seem very germane, to the extent it gives pause about the utility of econ as whole.

Immigration: Matthew Yglesias - I started out in life as a somewhat hard, "WHY ARE THE IMMIGRANTS COMING AND TAKING ALL OUR JOBS!!" type person, but Yglesias showed me the error of my ways on that one all by himself. The humanitarian argument was always there (to some degree) for me, but his consistently well-thought out posts on the subject have transformed my position completely. Immigration? good good good (one example among oh-so-many: http://www.slate.com/blogs/moneybox/2013/04/22/immigration_raises_american_income.html)

Well, I changed my mind about what your previous thoughts were...You needed to read all that to become convinced of the sort of things I considered a priori very reasonable, and some of them pretty obvious.Best, Pablo

Blogs in general have convinced me that people are quite selective about the topics on which they are willing to make uninformed comments. People who would not dream of expressing an opinion about thermodynamics, will comment all day about the very complex system that is the economy.

The exception to this rule is the Creationists, who are very willing indeed to comment about thermodynamics.

thermo has well defined rules that have been proven empirically beyond a reasonable doubt. macro, on the other hand hasn.'t but Bernanke has done a good job propping up stocks. we seem to be experts at keeping downturns as brief as possible.

Sure, Thermo is much more a hard science than is economics - unless you are a a Creationist, in which case you write your own rules - but most comments by the public on the Economy are garbage even *given* that. They don't miss by a percent or a decimal place, but often miss the entire concept.

I am not just being sarcastic. I am genuinely intrigued to know why so many people can look at pretty intractable and long-running economic problems and still plunge in with "It's all very simple...."

At which point they start insisting that only Gold is money, the Fed is privately owned, fiat currencies are the work of the Devil, Bernanke is "printing money", the euro is a huge success, austerity is the only way, and on and on. Choose their favourite crackpot solution, and magically all will be well.

It's a strange combination of ignorance, confusion and over-confidence that even has its own name, the Dunning–Kruger effect. It's well worth looking up, because it provides a structure for otherwise random-seeming Internet phenomena.

1) Matt Y has it right on regulation..."Too much local regulation and too little federal regulation."

2) Wars are very expensesive and hurts your country in the long run so pull back military spending.

3) The current problem today is capital is moving much too quickly than labor (Pettis).

4) I feel we have the reverse of The Great Stagnation...We are living in a world of labor glut and that is controling wage not Tyler's Great Stagnation. With labor glut we are not in a slow moving Keynesian liquidity trap.

What issues for Econo blogs to solve:

1) How did Japan with the most competitive dynamic and competitive end like they today? Is it punishment for great deeds or a demographic bust.

2) The great trends of robot future and falling birth rates (with less people in 2045ish) high level seems to fix each other problems. However, the human race takes 3 steps forward and 2 steps back. What are the steps back for these two trends?

Anon-Yglesias changed my mind to some extent about immigration too. However, I still am against most of the immigration we have currently. Almost all of it is strongly tilted in favor of getting cheap labor for employers. I've been convinced this is more akin to the non-zero sum increase in minimum wage than I had previously believed.

Now I believe we need to allow for immigration, but greatly decrease the power employers have over immigrants. Essentially time limited green cards with an easy path to full green cards and eventually citizenship. It would give the benefits of immigration while stripping the artificial bargaining power from the employer.

As to the question in general...

I believe Yglesias was the first one who opened my eyes to the non-zero sum nature of the minimum wage. It may have been him or Duncan Black, but I'm pretty sure it was Max Sawicky that sealed the deal. Dean Baker was also likely involved.

SR Waldmann brings things to my attention which I'd never fully considered but wouldn't have agreed with until he'd explained it.

For instance, the idea that not all profit is created equal. And that society really should be only encouraging certain types of profit.

General mental decline prevents me from being too-too specific, but blogs by Krugman, DeLong, Thoma, Felix Salmon, Steve Randy Waldman & Noah Smith have changed my mind fundamentally in two ways. First, by impressing me with the legitimacy of the basic practice of "capitalism" (dislike the broad words but they are sometimes appropriate) and second by convincing me that there is no pat, convenient lefty solution to our problems. But rather, we need to be vigilant against the tendency to let our lefty impulses run wild.

http://instituteofeconomicunderstanding.org that high debt, job loss is not bad for the economy. that to buy stocks on every dip. that too big to fail policy was a success even if mainstreet was left out.

Reading Naked Capitalism, guest post by Parenteau, "Leading PIIGS to Slaughter" convinced me, via his explanation of fiscal balances, that the Eurozone is not viable, that the only way out is via permanent direct sizable (5%+ of gdp) transfers from Germany to the non-core countries.

Yes, in fact the euro has become something very paradoxical. Initially introduced with the aim of "growth and stability" it has led to a situation of GDP contraction and growing social instability.

The members of the euro area are now condemned to suffer contraction and instability in their efforts to preserve a currency originally hyped to promote growth and stability.

The thing that really worries me about the euro is that while an unsuccessful economic experiment in one country - for example nationalization in the UK 1945-79 - is bad enough, the consequences of the euro affects at least 300 million people and 18% of World GDP.

In a sense the euro area has become an "economic monoculture". If it works, it works for everyone, and if it fails you get the economic equivalent of the Irish potato famine on a vast scale.

I never had much respect for what was popularly presented economics. It never made much sense. Why should the wealthy invest more just because their profit margins are rising? Surely, they would invest more if wages were rising as it would be increasing their customer base. (Then again, I grew up in an era when business magazines published regional income figures so that businessmen could exploit the new markets.) I always thought that the popular economists were either morons or paid shills. (I met my first paid shill at a Bulova meeting when I also met General Omar Bradley.)

Bloggers taught me two important things.

1) I wasn't alone about my view of popular economics. They were all either morons or paid shills. I wasn't being unfair or unreasonable. A lot of people, even people with economics credentials, thought the same.

2) Bloggers are basically essayists, and major movements often start with essayists. Look at the Federalist Papers. Look at Martin Luther's 99 Theses. Look at the Enlightenment philosophers. Look at the Old Testament which is just a collection of essays by various authors in an ancient group blog. (So is the sequel, for that matter.) The English word "essay" comes from the French word for "try". Maybe there is hope. Maybe we can push back against what Marcel Clements, in her book of essays, called the "mutant elite".

It seems consistent with what we know about human belief formation, and with my own priceless "personal experience!", that economics blogs would be more influential in establishing beliefs than in changing them. We know from marketing that repetition (herping derp) really works, so I would expect beliefs that are shorter to state, simpler to grok, and more frequently repeated to be more popular. Now, time to shill for some dandruff shampoo.

Absolutely right, nuance is something to be shunned and catchy slogans are prized. 2008 elections proved that to me how harsh is it to face reality than to live in dreamy world. A long time good friend of mine was so emotionally invested in Obama campaign the she literally cried for days when Sarah Palin was declare as VP candidate and Obama numbers turned down. Basically i said that at least with George Bush we knew what we are getting, but we've no clue as to what Obama is for. It took 2 years for her to speak with me again as i am agnostic about elections since i realised there is no real choice but just a false choice. I understood that people are more prone to catchy things and does not look for substance and does not take well to anything that causes inconvenience to their emotional well being.

I used to think having a PhD and being a professor was impressive. But many economists on the internet have demonstrated, by example, that even some of the leading academics are some mixture of vicious, foul, incompetent, ignorant, and foolish. Generally speaking, most economists are trained to be unable to discuss economics outside a narrow and self-defined circle. They are encouraged to be ignorant of actually existing economies and of the history of their field.

I learned that economists are at best able to explain economic growth only after the fact. I learned that Paul Krugman (and most economic bloggers) knows nothing about healthcare. I learned that Greg Mankiw is fundamentally untrustworthy in his public pronouncements. (I had initially assumed that Mankiw had a similar model to everyone else but would put in different values for various effects in order to come up with different results. Instead he just leaves various terms out when inconvenient.)

I learned that Noah runs one of the very few, if not only, blog where real discussion (rather than propaganda) is favored.

I learned that Noah runs one of the very few, if not only, blog where real discussion (rather than propaganda) is favored.

Honest comment, and absolutely no ill-will intended--I don't really see this. Most of the comments on this blog seem to be cheerleading, rather than real discussion. Whenever opposing viewpoints do clash, name-calling and insults often seem to ensue (with the owner of this blog leading by example a bit too often, imo).

That said, I heartily endorse Noah's recent effort to get a roundtable discussion with Beckworth and MMT ppl on money issues. That type of real discussion would certainly be valuable.

It's hard to get good discussions going on blogs because, let's be honest, we're not really qualified to discuss most issues. Amateur economics isn't like, say, amateur computer programming or amateur mathematics. If you think wrong things about programming or math, as they say, "you're gonna have a bad time." But we can think whatever we want about economic issues because we'll never have our ideas tested. We don't have to be right--nothing happens! So it's too easy to be certain of things we couldn't possibly know.

Noah has not convinced me that economists disagree less than you might think

Good thing I haven't convinced you of this, since I absolutely don't believe it, and in fact I believe the opposite! I think economists disagree a lot more than most people realize...or realized before the crisis, at any rate, after which some of the disagreements were aired more publicly.

So yeah, I definitely don't want to convince you of the opposite of what I believe!!

or that "neoclassical" is a meaningless term.

I'm not sure it's a meaningless term, but the way most people use it is dumb! ;-)

The combination of Free Banking literature and Market Monetarist bloggers (Sumner, Lars Christensen) convinced me that monetary contraction is clearly bad and that NGDP targeting is a better central bank guideline than inflation targeting. I was also convinced that monetary easing now is likely desirable by this great talk by Beckworth and Sumner: http://www.youtube.com/watch?v=YRWhgAyor30

JP Koning convinced me that Ripple, rather than Bitcoin, is likely the most important development in the cryptocurrency movement.

Tony Yates [new entrant to blogosphere]. I was very moved by Acemoglu and Robinson's work that deregulation/liberalisation can sometimes reduce efficiency by funnelling resources towards groups who then extract more rents, and won't necessarily always/ever yield the benefits that the Washington consensus [include myself] ascribed to them, (in my case based on comparing plain RBC model with same augmented with nasty taxes to mimic regulations].

Regarding solar energy - the real problem is not the cost efficiency of solar panels/collectors, the question is does Moore's law apply to energy storage and intermittency technologies? With the lone exception of geothermal, renewable energy does not provide continuous base-load power, or peak-load power when/where it is needed. Few locations have the scope for storage facilities near the location the power is needed. The means of storing large amounts of electricity have not been developed as yet and remain the limiting factor on a larger scale of energy production.

I like nuclear energy too, of course, but it seems very clear to me that it is not happening. Not on the scale we'd need it to happen, anyway. People are too scared of it. Fukushima killed whatever nuclear renaissance we were going to get.

Until someone dismantles the GE Mark I reactors (a.k.a. time bombs -- same design as Fukushima, and the worst design ever), nobody sane is going to trust nuclear.

This is something I learned *before* reading econ blogs, and which econ bloggers do not pay enough attention to. Institutions matter.

You can have the best idea in the world, but if you ask people to trust its implementation to an untrustworthy institution with a bad track record, they won't, they'll actually oppose your idea *because* you're supporting an untrustworthy institution -- and *they're correct*.

What I've learned from blogs is that politics gets mixed up with economics far more than it does in other media, like academic articles, and that politics is the driving force. Two examples that have convinced me of this: Mankiw and Krugman, whose economics is essentially the same but who end up at opposite ends of the spectrum because of their politics.

Another thing I've learned is that being gentle and well-mannered (Mankiw) makes you pass as the reasonable "centrist" when you may not be all that, while being agressive and rude (Krugman) makes you pass as a "left-wing nut" but gives you an awful lot of airtime and coverage.

I view economics from two distinct perspectives: the urgent and the important. The urgent is about solving current problems (jobs, debt, Euro) using existing economics. The important is about evolving a better economics to avoid/diagnose/cure future crises.

In terms of the urgent, the only blogger who really influences my views is Paul Krugman. For example, he completely changed my view on the Euro. I like his blog because he talks about relevant subjects, uses fact-based arguments, and writes clearly and concisely. I also like that he sometimes intervenes in convoluted discussions amongst other bloggers and simplifies/summarises the key points in a couple of sentences.

The only other economist who influences my views on the urgent is Joseph Stiglitz. He doesn’t blog but I have watched him give presentations on YouTube. These have been invaluable as they go into more depth than a blog post while still being digestible for a non-economist.

However, I don’t accept everything that Krugman and Stiglitz say. For example, Krugman is a very intuitive thinker. As a result, for me at least, when he talks about the mental models he uses, he is mostly unintelligible. When he says that his models don’t include banks and money, I am at a loss as to what they do include.

In terms of the important, I have read and watched both Krugman and Stiglitz on the future of economics. However, they both suggest that the next generation should lead on this, so I look elsewhere. I read other blogs in search of a vision for a better economics and a plan for getting to that vision. What I find is that the economics profession is mostly a leaderless, rudderless soap opera of well-intentioned, bright people who seem to lack the imagination to view the world from a different perspective and the tenacity to achieve anything useful. There are endless posts about symptoms of problems, but not much about a better vision, and absolutely nothing about plans to achieve that vision. The few people who seem to have something original to say (e.g. MMT, Steve Keen) are often clueless about communicating with their supposed colleagues. (In their defence, they would probably argue that their supposed colleagues are clueless about communicating with them. It takes two to tango).

For me, the most influential blogger on the important is Cullen Roche. Economics is full of too many ideas most of which are useless, half-baked or motivated by political ideology. Cullen is the only blogger I have found who understands that economics will not progress until it is pruned back to a core which describes the world we live in rather than a fantasy world, and which is intelligible enough to be communicated to non-economists. I don’t think it is a coincidence that Cullen is not an academic and works in the private sector where he is required to sell ideas to normal people.

A combination of a whole bunch of things caused me to *finally* understand deflation, after which I figured out money. (Yes, I think I now understand it better than most of you econbloggers, but I wouldn't have figured it out if I hadn't been reading essay after essay about deflation, disinflation, and unemployment.)

I really didn't realize how bad deflation was until I started reading the econbloggers. I was like "inflation isn't that bad, surely deflation isn't that bad either, inflation and deflation alternated for thousands of years".

So econbloggers caused me to abandon my support for stable prices / steady money, in favor of support for continuous (low) inflation.

I should also mention one piece of reading which changed my entire view of the 1960s/1970s economic situation:

http://www.prrths.com/Hagley/PRR_hagley_intro.htm

I read through everything from the initial proposals for the Penn Central merge through the formation of Conrail. (It's a hobby.)

And just the *background* news items suddenly put something into sharp clarity for me: the 1970s inflation was really, really, really due to the oil shocks, with contributing factors being the wage & price controls, and the early grain harvest collapse.